I asked my friend in China about the domestic mails and how they work. His answer was revealing. There is a government mail system, the China Post. It’s a big official bureaucracy that moves mail around the old way. Its origins date to the 1870s.
But today, hardly anyone thinks to use it for anything. It is there. Trucks roll around. Postal branches are here and there, and bureaucrats variously rattle around in them. But nearly all people and businesses use private services instead. There are dozens of them, even hundreds of them, all specializing in some different kind of service. New ones pop up every week.
Why do people use them? The private services have tracking. They are fast. They pick up from anywhere, and nearly instantly. They are ridiculously competitive so prices are constantly falling. It’s a booming market that makes the government’s service look ridiculous by comparison.
These entrepreneurs, who innovated around the prevailing monopolies and regulations, have increased opportunity, prosperity, and freedom. No longer are people bound by the choices government gives them. They can leave the system and find new and better ways to live. This is a huge part of what it means to be free.
Still the Chinese government slogs on, doing ever less. How long can they keep up the charade? Probably a long time. Maybe even longer. But its services will be obsolete, unexpandable, ineffective, largely irrelevant to people’s lives, and, therefore, constantly threatened with termination.
In the U.S., something similar is happening. The Postal Service is cutting back and back. It is closing branches. It is reducing service. Sometimes it partners with private services, and sometimes it just crushes competitors — anything to survive another day.
Private and public continue to exist side by side. But which is favored by the direction of history? Services that make life better last and those that do not lose energy and die, even when they are funded by government.
Government can prolong a useless function but not forever. Technology is an inexorable force. Government can slow it down but it can’t stop it. The private sector keeps getting ever more amazing while the government’s services — all over the world — keep getting worse.
The trend is spreading. It is affecting transportation where government monopolies are being shattered by private upstarts. It is happening to communication where, in a matter of a few decades, we went from government-owned talk boxes on the wall to magic human knowledge servers in our pockets.
It is happening to education (public education is rarely the first choice), retirement pensions (no one under 50 believes government will perform), health care (government-operated is synonymous with scandal), and security (even the government hires private services now).
In every area of life, the trend is obvious and it is intensified by the digital revolution, which opened up a new frontier for entrepreneurs to innovate outside government systems. The new innovations have become essential to our lives.
Thanks to the app economy, for example, we can listen to worlds of music, track our sleep patterns, navigate cities, play a musical instrument, all from our cell phones. Thanks to peer-to-peer websites, we can sell our stuff, rent an extra room in our house, call for a car, attend classes with great teachers — or we can switch the whole process and buy stuff, get a room, get paid to drive, or teach a class. The tools for doing all these things are distributed to everyone, and bypassing governments completely.
This is a much more effective path toward liberty than conventional politics. All over the world, people are suffering under the weight of central planning, regulation, high taxation, barriers to trade, and monopolies over education, banking, money, and so many other areas. People are clamoring for more room to breath, create, and serve. But how do we get from here to there? Innovation is the productive path that is making the difference.
Let’s take a step back and examine a fundamental question about government. Why does government provide any services at all? Why don’t the political elite and their bureaucratic functionaries just take our money and keep it for themselves to live the high life forever at our expense? Why do they even bother to pretend to do things for us like protect us, give us lifetime security, clean the environment, protect us from bad guys, administer justice, and keep us from self-destructive behaviors?
The state be better off not doing any of this. Instead of sticking its neck out to pretend to do glorious things for us, it would be far better off just operating as an open parasite on the rest of society.
But here’s the problem. States need the support of people, at least tacitly. No government can rule by force alone. Control is crucially dependent on winning hearts and minds. It’s that deeper cultural commitment to the rule of the majority by the minority that assures the stability of the state and keeps upheaval and revolution at bay. This is the fundamental reason for why the state keeps expanding its list of claims for how wonderful it is.
But look what happens when the state is not so wonderful anymore, when its security systems, banking systems, monetary systems, educational systems, regulatory systems, retirement programs, environmental and labor bureaucracies are obviously underperforming as compared with what can be accomplished outside the state. People naturally and normally, purely as a matter of self interest, gravitate away from what doesn’t work toward what does work.
They can build the state. But they can’t make people use it, especially not if better alternatives exist. There are thousands and millions of ways to leave leviathan today. They surround us, from Uber taxi to Bitcoin to homeschooling to private medical services to online pharmacies to private environmental preserves.
Name any seemingly essential service that government has offered in the 20th century and you can name a cheaper, more effective, more innovative, and more accessible private alternative. There is nothing that states can do that needs to be done that markets cannot do better. The current technology trajectory is proving the point, many times over.
The result is political instability. A paradigm shift. Obsolescence of the public sector. The growing irrelevance of power. Ever less dependent on, and hence loyalty to, the coercive power structure and ever more cultural, economic, and social reliance on the structures that society creates for itself. The tolerance for taxation, slavery, spying, regulation, and war begins to decline. Eventually it dies because it is unsustainable without public support. That’s the story of how human liberty prevails over tyranny. It could be the story of our near-term future.
This is a peaceful path to reform. It is not a certain path but looking around the world today, it is one that is most productive of human needs and also the one most threatening to the political elite. The ruling elite won’t go without a fight but increasingly they will be fighting people who are already discovering a better way of life than to live at others’ expense.